Modern Mining November 2024

MINING NEWS

Amid a tough year, South Africa’s mining industry sees significant uptick in M&A activity It’s been a challenging year for South Africa’s mining industry. Commodity prices, with the exception of gold, have been under pressure causing a significant drop in both revenue and profits. Mining industry headlines have also been dominated by retrenchments, falling stock prices, restructuring for efficiency and efforts to become more fit for purpose. “These companies have had to look beyond just mining to survive the downturn,” says Andries Rossouw, PwC Africa Energy, Utilities and Resources Leader. “This past year, we observed that what was front of mind for many companies was safeguarding their balance sheets to survive the down cycle and to position them for opportunistic prospects.”

Gold continues to demonstrate its store of value in times of risk.

Andries Rossouw, PwC Africa Energy, Utilities and Resources Leader.

Vuyiswa Khutlang, PwC South Africa Mining Assurance Partner.

T he newly launched PwC SA Mine Report 2024 takes a closer look at the challenges faced by mining companies this past year, the spike in deals seen across the sector, and the survival mode adopted through these turbulent times. Market performance, a surge in M&A activity and industry trends In today’s landscape, there is a global pursuit of a just energy transition. This, coupled with the need for efficiencies, diversification and strategic alignment, has resulted in the sector experiencing a hive of merger and acquisition (M&A) activity in the past year. “The quest for copper and other strategic minerals, broader consolidation and operational synergies, and diversification and strategic realignment to create shareholder value have been the main themes emerging from M&A transactions,” Rossouw says.

“The increase in deal values aligns with global trends, and this is being driven by the quest for critical minerals,” says Vuyiswa Khutlang, PwC South Africa Mining Assurance Partner. “Globally, the deal-critical minerals of focus were gold and copper—the prices of which performed exceptionally in the current year. For South African companies, it was no different. Copper and other strategic minerals have become increasingly sought-after as the world transitions to a low-carbon economy and the demand for clean energy solutions surges. Gold, on the other hand, continues to demonstrate its store of value in times of risk.” Building resilience through the balance sheet South Africa’s mining industry has not been spared

8  MODERN MINING  www.modernminingmagazine.co.za | November 2024